UPDATE 1-Nikkei hits 30-year high as financials gain on Democrat control of Senate

(Updates to close)
TOKYO, Jan 7 (Reuters) - Japanese shares ended higher on
Thursday, with the Nikkei touching a 30-year peak, powered by
financials as U.S. bond yields climbed on expectations of larger
stimulus following a Democrat sweep in two Senate runoffs in
Georgia.
The Nikkei average .N225 closed 1.60% higher at 27,490.13,
hitting its highest level since August 1990 at one point during
the session and snapping a four-day losing streak.
The broader Topix .TOPX added 1.68% to 1,826.30, climbing
above a peak hit late last year to reach its highest level since
October 2018.
Investor appetite was not dented by the chaos in Washington
D.C. after supporters of President Donald Trump stormed Capitol
Hill, forcing Congress to suspend a session to certify
President-elect Joe Biden's victory. "That seemed like the ultimate epitome of four years of
Trump's presidency. But no one thinks the election results will
be overthrown by this," said Takashi Hiroki, chief strategist at
Monex.
Shares of Japanese banks and insurers, big investors in U.S.
debt, are highly correlated with U.S. bond yields and were
boosted by moves in the Treasury market.
Insurer Dai-ichi Life Holdings 8750.T rose 7.4%. Among
banks, SMFG 8316.T gained 5.5%, while Mizuho 8411.T added
3.3% and Mitsubishi UFJ 8306.T rose 3.5%.
Other cyclical, value shares also gained on hopes of a
stimulus package from the incoming Biden U.S. administration.
Steelmakers .ISTEL.T gained 5.2%, with Nippon Steel
5401.T rising 7.8%. Ship builder Hitachi Zosen 6501.T surged
13.7%.
The Democrat victory in the Senate fanned renewed appetite
in renewable energy stocks, with Renova 9519.T jumping 10.6%
to a record high.
Domestic leisure-related shares, such as railway companies
.IRAL.T , bounced back even as the government looked set to
impose a one-month state of emergency in Tokyo and three
neighbouring prefectures to curb a spike in COVID-19 cases.
"The economic impact would be much smaller than previous
declarations as it is confined to Tokyo and restrictions will be
limited," said Hiroyuki Ueno, chief strategist at Sumitomo
Mitsui Trust Asset Management.
SoftBank Group 9984.T dropped 1.6% on news that the Trump
administration is considering adding Alibaba Group Holding Ltd
9988.HK to its trade blacklist of Chinese companies.
Softbank Group is the largest shareholder of the Chinese
e-commerce giant.